The degeneration of capitalism from a system of production to a speculative orgy

In ‘Do corporate insiders use stock buybacks for personal gain?’, Lenore Palladino investigates whether corporate insiders sell their own personal shareholdings more frequently when they are executing stock buybacks using corporate funds. Examining transactions for nonfinancial corporations with publicly traded stock from 2005 to 2017, Palladino finds that net insider sales of over $100k are nearly twice as common in quarters when stock buy-backs are also occurring than in non-buyback quarters. Palladino conducts an empirical analysis of the relationship between stock buybacks and insider transactions – and finds that a ten percent change in stock buy-backs is associated with a half-percent change in corporate insiders selling their personal shareholdings, holding other factors constant. This suggests that executives may indeed be taking advantage of the regulatory loophole left in the regulation of stock buybacks, and that policymakers should reform the regulations governing stock buybacks and corporate insider share-selling.